In This Article:
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Revenue: ARS166.1 billion, decreasing 28% in the quarter.
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Cement Volume: Down 32.5% year-over-year.
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Consolidated Segment EBITDA: $51 million or ARS38 billion, down 11.7%.
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EBITDA Margin: 28.1%, expanding 520 basis points year-on-year.
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Net Debt: $270 million.
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Net Profit: ARS29.6 billion, compared to ARS9.5 billion in the second quarter of 2023.
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Net Debt-to-EBITDA Ratio: 1.6 times.
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Operating Cash Generation: ARS16 billion.
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Capital Expenditures: ARS16.3 billion.
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Total Debt: $220 million.
Release Date: August 08, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Loma Negra Cia Industria Argentina SA (NYSE:LOMA) reported a solid set of results despite challenging market conditions, demonstrating resilience and operational strength.
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The company achieved an EBITDA margin expansion to 28.1%, an increase of 520 basis points year-on-year, showcasing effective cost management and pricing strategies.
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There is a gradual and consistent recovery in cement volumes, indicating a positive trend in the construction sector.
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The company has maintained a strong balance sheet with a net debt of $270 million, allowing for financial flexibility.
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Loma Negra increased the proportion of renewable energy in its energy mix to 61%, up from 46% in the previous year, reducing energy costs and enhancing sustainability.
Negative Points
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Loma Negra experienced a 28% decrease in top-line revenue, primarily due to a significant 32.5% decline in cement volumes.
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The construction sector remains challenging, with bulk cement dispatches down 41% year-on-year, indicating ongoing market difficulties.
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Concrete and aggregates segments posted significant contractions, with concrete revenues decreasing by 47% and aggregates by 46%, reflecting weak demand.
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SG&A expenses increased by 28.5%, impacting overall profitability despite a decrease in turnover tax and freight costs.
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The company's net debt-to-EBITDA ratio increased to 1.6 times from 1.4 times at the end of 2023, indicating a slight increase in leverage.
Q & A Highlights
Q: Can you provide insights on July volumes and pricing trends? Are these improvements sustainable? A: Volumes in July showed a significant recovery, and we believe this is due to several factors, including lower inflation and improved economic conditions in Argentina. We expect this trend to continue, supported by factors like increased credit availability and public works activity. Regarding pricing, we aim to maintain current levels, aligning with FX and internal cost evolutions. Margins are expected to remain stable, with potential improvements in the fourth quarter due to favorable energy contracts.